Right from the start, the UK’s airports have consistently supported measures that protect public health. This is despite knowing the financial pain additional travel restrictions would bring to our businesses.
In many cases, we have led the way in pulling industry and Government together to work on future measures to enable travel to resume safe when the time is right.
The past few weeks have been no exception, as we have continued to back the Government’s decision to suspend travel corridors alongside strengthening restrictions at the border.
Once again, we have come to the table to propose a risk-based roadmap out of these restrictions.
‘We have come to the table to propose a risk-based roadmap out of these restrictions’, say the bosses of Manchester, Heathrow and Gatwick airports
We agree with the shared goal of ending this crisis and resuming normality as soon as it is safe to do so.
However, there are three areas where it feels we are out of step with the Government, despite repeated reassurances from Ministers they will do everything necessary to protect the UK aviation industry and the jobs it supports.
The first is recognising the true scale of the impact Covid-19 has had on our sector and its ability to recover without targeted support after almost 12 months of no revenues or passengers.
The second is just how critical aviation is to the UK and to the more than one million people employed in our sector.
The third is the apparent disregard for the fact that our industry will provide the tools to deliver the Prime Minister’s twin visions for levelling up and creating a Global Britain.
Of course, all sectors feel they need support and that they are a special case. But that does not mean we should ignore the unique role aviation plays.
Airports are critical parts of our national infrastructure and an enabler of Britain’s success. So many other parts of our economy rely on the international connectivity we provide.
Unless the Government grasps the true significance of the role we play, it risks giving away our success and our competitive advantage. The longer we go unsupported, the less likely we will be in a position to help drive the UK’s recovery and to deliver the Government’s manifesto pledges.
Our businesses are somewhat different to others. From day one we have remained open for critical flights that carry supplies such as PPE, and we are now helping facilitate the vaccine roll-out. We have also supported the repatriation of UK citizens stranded abroad.
To ensure we stay open and provide a vital role in fighting this virus – at the same time as paving the way for a strong recovery – we have had to reduce costs wherever possible.
Heathrow has already lost its crown as Europe’s busiest airport, bosses say
More than 10,000 people working at our airports have already paid for this with their jobs, both from our direct employees and the wide range of airport partners such as ground handlers, airlines and catering companies.
This is having, and will continue to have, a hugely negative impact on local communities reliant on our airports for jobs. The quicker we can open up travel, the quicker we can continue to be a driver of regional and national economic prosperity.
The one bill we have not been able to reduce by a penny is that which we pay to the Government. Together, we served 188million passengers in 2019. Last year, the figure was 20 per cent of that. Standing at more than £335million collectively, our fixed costs for business rates, policing and air traffic control have remained the same – despite a near complete collapse in demand.
Our airports are unable to diversify like other businesses. And as bosses of the UK’s largest airports, we are collectively making losses of around £50million a week. If protecting the country means these strict controls on travel need to continue, there must be targeted financial support which reflects our new reality. We also need to start the planning for what our future will look like as we safely reopen.
Heathrow has already lost its crown as Europe’s busiest airport. Since the start of this crisis, Manchester, London Stansted, Gatwick and East Midlands have also lost or seen a suspension of direct and critical trading routes. We need to open up routes to Europe as a first phase to reopening to the world.
‘Most of the costs of running an airport cannot be turned off or turned down, and the furlough Job Retention Scheme has covered less than a sixth of our total costs,’ airport bosses said
We are all now in a fight with our European competitors to win these routes back. We know that building trade links requires strong connections.
So, unless we rebuild services to the likes of Canada, Singapore and Malaysia, the UK’s aspiration to become members of international trade deals like the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) will remain grounded.
None of the 11 CPTPP member countries tipped to experience huge growth in years to come, will rely solely on shipping.
Without action, this Government will be levelling down and creating a Little Britain rather than a global one.
The Government repeatedly talks of the ‘unprecedented support’ it has given to aviation. Much of this is no different to the support offered to all sectors of the economy, such as the furlough scheme, as welcome as that has been.
Like most businesses, we have made use of the furlough scheme to maintain jobs as far as we can. But most of the costs of running an airport cannot be turned off or turned down, and the furlough Job Retention Scheme has covered less than a sixth of our total costs.
The Airport Support Scheme, which offers less than one quarter off a collective bill of £186million, was inadequate in November. It now verges on disbelief. It was designed to respond to the pressure we faced in 2020 and fails to consider the impacts of a further national lockdown, the suspension of airbridges and further border restrictions.
This lacklustre response from the Government would have been seen as wholly inadequate if the same measures had been offered to rail, Tube and bus operators as they encountered the same loss of passengers.
John Holland-Kaye, chief executive of Heathrow airport
Germany, France and Portugal have all provided two to three times the level of financial support to their aviation sectors that our Government has given.
The Treasury has a straightforward choice. Last year, supermarkets returned £1.8billion in unnecessary business rate alleviation after receiving the support whilst recording bumper profits.
The Chancellor said early on that he would support businesses (big and small) with policy that would see them through this crisis. In that his original judgement was misplaced with supermarkets, we ask the Chancellor to revisit the devastating impact on aviation and redistribute some of that money to a sector facing a real threat.
The things we have needed from Government have not changed since the start of this outbreak, nearly 12 months ago.
Stewart Wingate, chief executive of London Gatwick airport
In writing this a year on, the only things that are different are the scale of the financial impact of the crisis, the losses we have experienced in terms of passenger numbers and, most sadly of all, the number of jobs that have been lost at our respective business, and across the industry.
The toll of job losses will only increase unless we work with Government on a roadmap out of this and, in the meantime, agree what fair support looks like while we are prevented from doing business.
International travel and trading are fundamental to Global Britain and recovery. The Government cannot have a Global Britain with a grounded and damaged aviation sector. Nor can it have a well connected, levelled-up Britain if we emerge weakened.
And in terms of supporting the global vaccination programme once the UK is protected? Unless they plan on sending supplies via our EU competitors or on sea containers, they need an aviation sector that can take off quickly when that time comes.
Continued disregard for our sector will only cause this economic hardship to spread and weaken the many sectors that rely on global markets, such as inward investment, tourism and higher education, at the very start of the UK’s journey outside the EU.
We want to support the Government on its plan to repair the damage. In the 21st Century economy, an increasing amount of global trade travels by air – if the UK can maintain its leadership as having a world class aviation sector, we can help to deliver a thriving independent ‘Global Britain’.
Charlie Cornish, John Holland-Kaye and Stewart Wingate are the chief executives of Manchester, Heathrow and Gatwick airports.
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